Update: 25 June 2018
Speculators Slash EUR, GBP & JPY bets, Go Long USD Overall
Data in this report cover up to Tuesday, June 19 & were released Friday, June 22.
• CFTC data for the week through Jun 15th reveal some significant positioning changes among speculative and leveraged position takers.
Investors have slashed or reversed bull bets on the EUR, GBP, and JPY in the main over the past week, turning last Friday’s aggregate short USD position of around USD7bn into a net long USD position of just a shade of USD10bn—the first sniff of bullish sentiment on the USD in a year.
• The big three currencies accounted for the bulk of the positioning swing, with investors culling USD7.7bn—over half—from the net long EUR position seen last week. Net longs remain decent at around USD5.2bn in total but this represents the weakest bull sentiment on the EUR since early May. Investors clearly acted defensively in response to the tumble in the EUR following the ECB’s policy decision on Jun 14th. GBP sentiment took a sizeable hit, the net short increasing by around USD1bn to USD2.5bn, while net neutral sentiment in the JPY in recent weeks deteriorated suddenly, producing a net short of just over USD4bn. The CHF saw modest net short -covering in the week (USD700mn).
• Commodity currencies saw—mostly—more shorting activity in the week, with AUD sentiment deteriorating sharply (adding USD2bn to net shorts) and net bearish NZD bets rising USD500mn. Curiously, if trade fears were at least partially responsible for investors flocking to the USD, neither net CAD nor net MXN positioning changed significantly
this week and remains more neutral in both cases.